Chinese brands seek higher profile

15 October 2013

BEIJING: Chinese brands are adopting a variety of strategies to boost their appeal to sceptical global consumers, ranging from acquiring well-known Western companies to establishing overseas headquarters for goods aimed at developed markets.

Despite its status as the world's second-largest economy, China does not have a single brand in the world's top 100, as measured by marketing consultancy Interbrand, and representatives from some of China's leading companies have spoken to Agence France-Presse about how they are trying to overcome barriers.

As reported by Industry Week, Chinese telecoms security company NQ Mobile created two separate headquarters – one in Texas for developed countries; the other in Beijing for emerging markets.

Its Texan division is listed on Wall Street, is managed by an American co-CEO and all its employees in the US are American citizens, which group founder Henry Lin expects to help the consumer feel it's a US company.

"If you can be successful in the US, you would be successful in Western Europe, Japan, Australia," he said.

Other Chinese brands have turned to acquisitions to grow their worldwide presence. Notable examples include automaker Geely's purchase of Sweden's Volvo and Shuanghui International's $7.1bn takeover of US pork giant Smithfield Foods, the largest ever Chinese takeover of a US company.

"Brand China has many problems – transparency, ethical practices, treatment of employees, the quality of the products," said Richard Edelman, head of the eponymous public relations company, in remarks to the World Economic Forum in September.

"And unfortunately the China reputation for companies is much overshadowed by reputation of government," he added.

Security concerns and suspicions about telecoms giant Huawei and its alleged links with the Chinese government prompted the US to exclude it from public contracts.

But Huawei's vice president Scott Sykes strongly denied doing anything on behalf of the government and attributed these accusations to protectionism and lack of trust.

Sykes himself is an example of another strategy – to employ foreigners in high-profile roles. Others include Hugo Barra, a former Google vice president recently taken on by electronics company Xiaomi.